The difference between a premium pack and an ordinary one comes down to a few factors; substrate quality, manufacturing standards, uniqueness and the unboxing experience. A well-designed luxury pack will also help to tell a brand’s story, whereas normal consumer goods packaging tends to serve just a protective function. So, how should a brand go about premiumisation and upgrading its packaging?
Firstly, a brand owner must fully understand what premiumisation entails and how this can affect their target audience. Luxury labels are becoming increasingly sought-after and, in a world where product competition is fierce, brands need to make their products stand out. In developing markets, rising disposable income means that consumers have a little bit more to spend on premium packaging and products that catch their eye.
Premiumisation of packaging allows a brand to bridge the gap between the desirability of the luxury market and the necessity of the mass market. Otherwise ordinary products can be made more attractive and desirable through high-end packaging (or packs that at least look the part). Don’t be misguided; premiumisation of products and packaging can be a challenge and requires a delicate balancing act, but here are three tips to assist with the process.
1. Brand positioning may need to change
When a brand begins its premiumisation journey, it first needs to redefine its positioning and goals. The fact that it is undergoing this process means that it probably needs to refine its target audience and position itself differently. These decisions would have led to this point, where the brand wants to reevaluate its packaging.
The brand positioning will impact the product or packaging design, so in-depth market research and analytics need to form the foundation of these goals and decisions. A brand will need to look at examples of high-end packaging in its market, as well as others. A broader frame of reference will allow the company to narrow its focus and convey its premiumisation to the consumer more effectively.
2. Understand the target audience
Premiumisation is subject to the target audience and how developed the market may or may not be. A brand will need a deep understanding of its target audience before embarking on an upgrade of its packaging. This means understanding cultural perceptions of what it means to be luxurious and desirable. What is considered ‘high-end’ in one country may not be the same in another. For example, in developed markets, bespoke, handmade packs often translate to quality and luxury. Whereas in emerging markets, multinational and well-known brand names are often associated with status.
This means that some things are ubiquitous across cultural divides; overall packaging quality will often result in consumers regarding a pack as premium. The way it is manufactured and put together will immediately improve its desirability. Quality standards and controls will enable a brand to improve its packaging, regardless of the target audience. Beyond quality, a brand will need to use its market research and audience insights to guide its packaging developments.
3. Build on the brand’s strengths and assets
A brand needs to consider its strengths and what sets it apart from competitors in order to be considered premium and desirable. The company should focus on its distinctive assets and use these strengths to improve its packaging. These could include brand colours (like Tiffany & Co.), the shape of the packaging (such as Toblerone) or even its country of origin (think Swiss watches and Belgian chocolate). The strengths and assets should be a core component of any premiumisation process.
Luxury is directly related to exclusivity, which often stems from a brand’s assets and unique offerings. A product or pack that is custom or bespoke will immediately catch the consumer’s eye and intrigue. Premiumisation establishes a difference in the market, which is often a key selling point for those that like high-end products. If brand owners can truly understand what premiumisation entails, then it can be successfully implemented and used to improve their offerings.
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